What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-03-28 compared with 2023-03-30 · 83 added, 87 removed, 291 unchanged (37% of the section changed)

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Our goals, when each task

of this work is completed, are to file an IND with the FDA, take an initial drug product candidate into an early-stage clinical trial for

an initial indication, and/or pursue a co-development collaboration or out-license arrangement for the respective disease area and route

of administration.

of this work is completed, are to file an IND with the FDA, take an initial drug product candidate into an early-stage clinical trial

for an initial indication, and/or pursue a co-development collaboration or out-license arrangement for the respective disease area and

route of administration.

Company is endeavoring to fully elucidate the traits and characteristics of the RBS molecule using different academic medical centers

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y Tecnología Médica (ANMAT).

Nonproprietary Name

Non-proprietary Name

RBS name for the Company’s pharmaceutical-grade API was selected by and passed the review of the WHO Expert Advisory Panel on the

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the first quarter of 2022, the Company began work with a U.S.

contract development and manufacturing organization to rigorously and methodically

assess three lots of commercial-grade rose bengal, one each from three different specialty chemical suppliers, and compare and contrast

these non-pharmaceutical grade materials with the Company’s pharmaceutical-grade RBS.

This chemical analytical work was substantially

completed by the end of the third quarter of 2022.

The Company believes that the preliminary results of these analyses indicate that

all three lots of commercial-grade rose bengal had rose bengal purity that was drastically different from what was represented on their

respective certificates of analysis (“CofAs”), and that one of the three lots contained gross contaminants that were not

represented on its CofA.

contract development and manufacturing organization to assess rigorously

and methodically three lots of commercial-grade rose bengal, one each from three different specialty chemical suppliers, and compare

and contrast these non-pharmaceutical grade materials with the Company’s pharmaceutical-grade RBS.

This chemical analytical work

was substantially completed by the end of the third quarter of 2022.

The Company believes that the preliminary results of these analyses

indicate that all three lots of commercial grade rose bengal had rose bengal purity that was drastically different from what was represented

on their respective certificates of analysis (“CofAs”), and that one of the three lots contained gross contaminants that

were not represented on its CofA.

Barriers to Entry

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specifications and documentation.

Company believes that historical and potentially hazardous impurities and other manufacturing and handling issues facing non-pharmaceutical-grades

of rose bengal may pose significant scientific, technological, and economic challenges to overcome and validate for compliance with modern

drug regulatory standards.

Company believes that historical and potentially hazardous impurities and other manufacturing and handling issues facing non-pharmaceutical

grades of rose bengal may pose significant scientific, technological, and economic challenges to overcome and validate for compliance

with modern drug regulatory standards.

of Operating Results

revenue is recognized when qualifying costs are incurred and there is reasonable assurance that the conditions of the grant have been met.

Cash received from grants in advance of incurring qualifying costs is recorded as unearned grant revenue and recognized as grant revenue

when qualifying costs are incurred.

revenue is recognized when qualifying costs are incurred and there is reasonable assurance that the conditions of the grant have been

Cash received from grants in advance of incurring qualifying costs is recorded as unearned grant revenue and recognized as grant

revenue when qualifying costs are incurred.

and Development Expenses

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of the Years Ended December 31, 2023 and 2022

Grant revenue was $989,042 for the year ended December 31, 2022,

compared to $0 for the year ended December 31, 2021.

The increase was driven by grant revenue recognized related to qualifying

expenses that were incurred and included within research and development on the consolidated statements of operations.

operating expenses were $4,416,988 for the year ended December 31, 2022, a decrease of $255,266 or 5.5% compared to the year ended

December 31, 2021.

The decrease was driven by our continued transformation and process improvement efforts within the Company, along

with lower clinical trial and research expenses, reduced legal fees and lower rent expense.

Net loss for the year ended December 31,

2022 was $3,554,683, a decrease of $1,984,860 or 35.8% compared to the year ended December 31, 2021, which resulted from reduced

costs incurred in connection with our preclinical and clinical trial programs, general and administrative costs, and interest

expense due to the conversion of the 2017 and 2020 Notes.

Refer to tables below for year over year comparison

of revenues and expenses.

For the Years Ended

Increase/(Decrease)

Grant Revenue

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Research and development tax credit

Gain from forgiveness of PPP loan and interest

Interest expense, net

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$2,389,360 for the year ended December 31, 2022.

The decrease was due to lower clinical trial cost and lower rent expense, partially offset by increased

insurance costs.

The decrease was due to lower clinical trial costs associated with full enrollment

of open trials, write-off of old accounts payable, and lower rent expense, partially offset by increased payroll taxes.

following table summarizes our research and development expenses incurred during the years ended December 31, 2023 and 2022:

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Increase/(Decrease)

Operating Expenses:

Research and development:

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$2,027,628 for the year ended December 31, 2022.

The decrease was due to (i) lower legal fees, (ii) lower rent expense, and (iii) lower other general

and administrative cost, partially offset by (iv) higher insurance cost, (v) higher professional fees, and (vi) higher payroll and related

taxes due to an additional employee.

The decrease was due to (i) lower legal cost relating to patent application and

general business fees, (ii) lower rent expense, (iii) lower professional fees, (iv) write off of old accounts payable, and (v) more

favorable foreign currency translation cost, partially offset by (vi) higher other general and administrative costs.

following table summarizes our general and administrative expenses incurred during the years ended December 31, 2023 and 2022:

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Increase/(Decrease)

Operating Expenses:

General and administrative:

Directors fees

Legal and litigation

Other general and administrative cost

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Income/(Expense)

and development tax credits were $36,954 for the year ended December 31, 2022, an increase of $5,639, compared to $31,315 for the year

and development tax credits were $15,696 for the year ended December 31, 2023, a decrease of $21,258, compared to $36,954 for the year

ended December 31, 2022.

from extinguishment decreased from $63,094 for the year ended December 31, 2021 to $0 for the year ended December 31, 2022 due to the

forgiveness of the PPP Loan and interest in 2021.

expense decreased by $798,007 from $961,698 for the year ended December 31, 2021 to $163,691 for the year ended December 31, 2022.

decrease was due to the conversion of the 2017 and 2020 Notes into shares of Series D and Series D-1 Preferred Stock.

expense increased by $52,523 from $163,691 for the year ended December 31, 2022 to $216,214 for the year ended December 31, 2023.

The increase was due to the issuance of new 2022 Notes, partially offset by the impact of the conversion of the 2021 and 2022 Notes

into shares of Series D-1 Preferred Stock.

following table summarizes our Other Income/(Expenses) incurred during the years ended December 31, 2023 and 2022:

For the Years Ended

Increase/(Decrease)

Other Income/(Expense):

Research and development tax credit

Gain from extinguishment

Interest income and interest expense

Total Other Expenses, Net

Interest expense, net

Total Other Income/(Expense), Net

and Going Concern

cash, and restricted cash were $1,431,707 at December 31, 2022, which includes the $1,410,102 of restricted cash associated with the

grant received from the State of Tennessee.

The consolidated financial statements and notes thereto included in this Annual Report on

Form 10-K have been prepared on a basis that contemplates the realization of assets and the satisfaction of liabilities and commitments

in the normal course of business.

cash, and restricted cash were $1,026,799 at December 31, 2023, which includes the $950,223 of restricted cash associated with the grant

received from the State of Tennessee.

The consolidated financial statements and notes thereto included in this Annual Report on Form

10-K have been prepared on a basis that contemplates the realization of assets and the satisfaction of liabilities and commitments in

the normal course of business.

We have continuing net losses and negative cash flows from operating activities.

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liabilities) and a $277,815 note payable related to our short-term financing of our commercial insurance policies.

Also, if not converted

prior to maturity, convertible debt in the amount of $1,827,500 plus accrued interest will mature one year from the date of the notes.

Cash requirements for long-term liabilities include $73,376 for operating lease liabilities.

The Company intends to meet these cash requirements

from its current cash balance and from future financing.

converted prior to maturity, convertible debt in the amount of $2,675,000 plus accrued interest will mature one year from the date

of the notes.

The 2022 Notes are only subject to repayment in the event of a change of control or event of default.

Cash requirements for long-term

liabilities include $25,299 for operating lease liabilities.

The Company intends to meet these cash requirements from its current

cash balance and from future financing.

plans to access capital resources through possible public or private equity offerings, including the 2022 Financing, exchange offers,

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cash provided by financing activities during the years ended December 31, 2023 and 2022 was $2,207,371 and $1,367,841, respectively.

During the year ended December 31, 2022, we received $1,627,500 proceeds from the issuance of convertible notes payable and $259,659

for the repayment of short-term note payable.

During the year ended December 31, 2021, we received $3,160,000 proceeds from the issuance

of convertible notes payable, $962,223 from the exercise of warrants and $150,000 from the investment to purchase Series D-1 Preferred

Stock, less $248,177 for repayment of short-term note payable.

Accounting Estimates and Policies

preparation of financial statements and related disclosures must be in conformity with U.S.

These accounting principles require

us to make estimates and judgments that can affect the reported amounts of assets and liabilities as of the date of the financial statements

as well as the reported amounts of revenue and expense during the periods presented.

We believe that the estimates and judgments upon

which it relies are reasonably based upon information available to us at the time that it makes these estimates and judgments.

extent that there are material differences between these estimates and actual results, our financial results will be affected.

A critical accounting estimate to our financial statements include stock-based

compensation, research and development expenses, grant, and valuation of income taxes.

The accounting

policies that reflect our more significant estimates and judgments and which we believe are the most critical to aid in fully understanding

and evaluating our reported financial results are described below.

During the year ended December 31, 2023, we received $2,475,000 of proceeds from the issuance of convertible notes payable and paid

$267,629 for the repayment of the short-term note payable.

During the year ended December 31, 2022, we received $1,627,500 proceeds

from the issuance of convertible notes payable and paid $259,659 for the repayment of the short-term note payable.

Accounting Estimates

prepare our consolidated financial statements in accordance with U.S.

GAAP, which require our management to make estimates that

affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as

well as the reported amounts of revenues and expenses during the reporting periods.

To the extent that there are material differences

between these estimates and actual results, our financial condition or results of operations would be affected.

We base our estimates

on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations

for the future based on available information.

We evaluate these estimates on an ongoing basis.

consider an accounting estimate to be critical if:

(i) the accounting estimate requires us to make assumptions about matters that were

highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from

period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact

on our financial condition or results of operations.

There are items within our financial statements that require estimation but are

not deemed critical, as defined above.

Accounting Policies

following is not intended to be a comprehensive list of all of our accounting policies or estimates.

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Annual Report.

The following represent our most critical accounting policies:

measure the cost of services received in exchange for an award of equity instruments based on the fair value of the award on the date

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expenses, fees paid to third parties and other outside expenses.

We accrue for costs incurred as the services are being provided by

monitoring the status of the clinical trial or project and the invoices received from our external service providers.

We adjust our accrual

as actual costs become known.

We accrue for costs incurred as the services are being provided by monitoring

the status of the clinical trial or project and the invoices received from our external service providers.

We adjust our accrual as actual

costs become known.

Company accounts for income taxes under the liability method in accordance with Accounting Standards Codification (“ASC”)

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as a discount to the host instrument.

the instrument is determined to not be a derivative liability, the Company then evaluates for the existence of a beneficial conversion

feature by comparing the commitment date fair value to the effective conversion price of the instrument.

Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement

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At all other times, preferred shares are classified as stockholders’ deficiency.

Grant Revenue

Grant revenue is recognized when qualifying costs

are incurred and there is reasonable assurance that the conditions of the grant have been met.

Cash received from grants in advance of incurring

qualifying costs is recorded as unearned grant revenue and recognized as grant revenue when qualifying costs are incurred.

The Company expenses all costs as incurred in connection

with patent applications (including direct application fees, and the legal and consulting expenses related to making such applications)

and such costs are included in general and administrative expenses in the accompanying statements of operations and comprehensive loss.

revenue is recognized when qualifying costs are incurred and there is reasonable assurance that the conditions of the grant have been

Cash received from grants in advance of incurring qualifying costs is recorded as unearned grant revenue and recognized as grant

revenue when qualifying costs are incurred.

Company expenses all costs as incurred in connection with patent applications (including direct application fees, and the legal and consulting

expenses related to making such applications) and such costs are included in general and administrative expenses in the accompanying

statements of operations and comprehensive loss.

Accounting Pronouncements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis